A company's profitability, and often its survival, is determined by how hard its employees are motivated to work toward its goals. Managers need to understand how to influence and persuade these employees using an effective leadership approach. This chapter has made the following major points:

1. Leadership involves using one's personality, beliefs, values, social skills, knowledge, and power to engage and persuade employees to do their jobs in a way that increases an organization's efficiency and effectiveness.
2. Power is the ability of one person to cause another person to do something that he or she would not have otherwise done. There are five sources of a leader's power: legitimate, reward, coercive, expert, and referent power. The possession of power does not create an effective leader. Leadership is the effective use of power in a particular work situation.
3. A charismatic leader is an exceptional leader who uses his or her referent or expert power to connect with and influence employees.
4. Leaders use their power to influence the work behaviors and attitudes of employees such that they further the interests of the company.
5. The contingency theory of leadership suggests that the most effective leadership approach is one that matches the characteristics of employees and their work situation.
6. There are four principal types of leadership approaches: directive, supportive, participative, and achievement-oriented.
7. The nature of the employee and work contingencies in a particular business setting determine which leadership approach will be most effective. The two most important employee contingencies are their (1) occupational skills and experience, and (2) their need for achievement and locus of control. The two most important work-setting contingencies are (1) the characteristics of the job (routine or nonroutine) and (2) the use of work groups and teams and the level of group cohesiveness.
8. Five important qualities all effective leaders possess are intuition, intelligence, and cognitive ability; drive and the need for achievement; self-confidence and an internal locus of control; good ethics and moral integrity; and emotional intelligence.
9. Persuasive communication is the attempt by one person or group to share information with another person or group in order to get them to understand their objectives and support them.
10. The different components of the persuasive communication process are the characteristics of the sender and receiver, the content of the message, active listening, and the method of communication.
11. Organizational politics are the activities that managers and employees engage in to increase their power and persuade others to pursue their goals. Political tactics are the strategies managers and employees use to gain support and overcome people's resistance.
12. Political tactics include attacking and blaming others versus making everyone a winner, reducing uncertainty and using objective information, being irreplaceable and in a central position, and building coalitions and alliances.